‘Buyer beware’ as pick and pay arrives
FIGHTING NETFLIX
Consumers who hate paying for dozens of television channels they never watch can celebrate t heir new right to tailor their own TV packages, with the caveat they won’t necessarily save money under the system.
As of Thursday, TV service providers must offer channels à la carte and in packages of up to 10 channels to complement existing TV packages in order to comply with a policy issued in spring 2015 by the Canadian Radiotelevision and Telecommunications Commission.
The regulator introduced the changes after a hearing that aimed to give consumers more choice in television packages to help broadcasters quell cord cutting and compete with streaming services such as Netflix Inc. The same decision forced provid- ers to offer $ 25 per month skinny TV packages as of March 1. The CRTC gave providers more time to introduce pick- and- pay so they could negotiate with programmers and rejig their billing and customer service systems.
If providers don’t follow the rules, the CRTC promises “remedial action” at broadcast licence renewal hearings next year. This month, the CRTC took the unusual step of renewing licences for only one year instead of seven so as to monitor these practices.
Providers generally grumbled about the basic package rules, arguing they should be allowed to create packages and price them based on what the market would bear. Pick-and-pay was more palatable to many industry players who submitted it should be allowed, but not mandatory. On the programming side, organizations such as the Friends of Canadian Broadcasting argued that single-channel offerings could hurt the diversity of the system and damage profits for content creators.
The CRTC plowed ahead with the new rules with the goal of increased flexibility. Uptake of skinny packages has been small ( less than 100,000 of Canada’s 11.2 million TV subscribers opted for these packages as of this spring).
Still, the CRTC called Bell, Rogers, Shaw and Videotron to the hot seat this fall to defend their skinny packages amid complaints they didn’t follow the “spirit” of the regulations. The regulator released best practices as a result of the hearing.
Bell Canada, which launched pick-and-pay channels nine months ahead of t his week’s deadline, has found the “vast majority” of its customers prefer pre- packaged theme packs, spokeswoman Michelle Michalak said in an email.
“They’re more convenient than sorting through and choosing from the hundreds of channels available and tend to offer better overall value than a selection of individual channels,” she said, adding Bell has already adjusted pricing based on cus- tomer feedback.
Rogers Communications Inc. l aunched its s tandalone channel selection tool on Wednesday and already exceeds most of the CRTC’s best practices, spokesman Andrew Garas said in an email.
Telus Corp. offered small basic packages well before the rules were in place in its bid to be the most flexible TV option on the market, spokeswoman Liz Suavé said in an email. “During a period of cord cutting, this has proven very attractive to our customers,” she said.
But consumers should be careful before changing their packages, Public Interest Advocacy Centre executive director John Lawford said.
“You’ ll get more choice and flexibility, but the price might be quite high,” he said, adding it could take hours of shopping around to figure out the best deal. His organization will be watching for companies that charge fees when consumers drop to lower plans or take away their bundle discounts for smaller packages. “It’s a bit of buyer beware,” he said.